The game takes place in an ancient land. There, both humans and dragons had both lived paying no attention to each other until one dragon after studying the human race believed they could be valuable allies to help rid the land of evil. They fought side by side for many battles until finally Skarrbor was defeated. Peace was brought into the world and the dragons taught the humans the secret of magic, but soon a powerful sect called the Zealots grew within the human race that believed the dragons would seek to gain the throne that Skarrbor once held. And so they began to destroy all the dragon eggs they could find.
Eventually the dragons decided to leave and avoid another bloody war while one dragon remained behind to hide a dragon egg in the ruins of a temple. That dragon then made a prophecy to a last faithful priest, before he flew away, that the evil Skarrbor would return in the 6th age to once again wreak havoc upon the lands. The 6th age came but the signs were ignored and before long Skarrbor's evil minions once again roamed the land destroying towns and killing all. Although the prophecy foretold doom, it also foretold of a savior. A strong and powerful beast. The Dragon.